General Dynamics awarded $119M for MIDAS Release 1 solution development and support

Contract Overview

Contract Amount: $119,024,325 ($119.0M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: General Services Administration

Start Date: 2012-01-06

End Date: 2014-01-31

Contract Duration: 756 days

Daily Burn Rate: $157.4K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: THE SCOPE OF THIS TO IS TO CONFIGURE, DEVELOP, TEST, DEPLOY AND PROVIDE PRODUCTION SUPPORT FOR THE MIDAS RELEASE 1 SOLUTION, AND UPDATE THE MIDAS PROJECT MANAGEMENT PLAN. MIDAS RELEASE 1 SHALL INCLUDE THE NINE SAP GRANTOR PROCESSES, ADDITIONAL SUPPORTING PROCESSES INCLUDING BUSINESS PARTNER, FARM RECORDS, ACREAGE REPORTING, AND ACTUAL PRODUCTION, AND LOAN SERVICING FUNCTIONS (RECEIVABLES MANAGEMENT) FOR THE MARKET ASSISTANCE LOAN (MAL) FARM PROGRAM FOR ALL CURRENTLY SUPPORTED CROPS EXCEPT COTTON, PEANUT, AND RICE.

Place of Performance

Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22033

State: Virginia Government Spending

Plain-Language Summary

General Services Administration obligated $119.0 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: THE SCOPE OF THIS TO IS TO CONFIGURE, DEVELOP, TEST, DEPLOY AND PROVIDE PRODUCTION SUPPORT FOR THE MIDAS RELEASE 1 SOLUTION, AND UPDATE THE MIDAS PROJECT MANAGEMENT PLAN. MIDAS RELEASE 1 SHALL INCLUDE THE NINE SAP GRANTOR PROCESSES, ADDITIONAL SUPPORTING PROCESSES INCLUDING BUSI… Key points: 1. The contract focuses on configuring, developing, testing, deploying, and supporting the MIDAS Release 1 solution, which includes nine SAP grantor processes and supporting functions for farm loan programs. 2. The contract's duration of 756 days (approximately 2 years) suggests a significant development and implementation effort. 3. The use of a Time and Materials contract type can introduce cost uncertainty if not managed closely. 4. The contract was not competed under SAP, indicating a potential lack of broad market engagement. 5. The scope covers critical financial and operational processes for agricultural loan servicing, impacting program efficiency. 6. The total award amount of over $119 million signifies a substantial investment in modernizing these systems.

Value Assessment

Rating: fair

The total award of $119,024,324.60 for a 756-day period (approximately 2 years) for the development and support of the MIDAS Release 1 solution appears to be a significant investment. Without specific benchmarks for similar large-scale SAP grant management system implementations, a direct value-for-money assessment is challenging. However, the Time and Materials (T&M) contract type, while offering flexibility, can lead to higher costs if not tightly managed, potentially impacting overall value. The absence of a competitive bidding process under SAP also limits the ability to benchmark pricing against market alternatives.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was not competed under the Streamlined Acquisition Procedures (SAP), suggesting it may have been awarded through a limited competition or a specific pre-existing agreement. The data indicates it was 'NOT COMPETED UNDER SAP' and awarded as a Blanket Purchase Agreement (BPA) modification. The lack of open competition means fewer vendors had the opportunity to bid, potentially limiting price discovery and innovation. Further details on the specific justification for limited competition would be needed for a full assessment.

Taxpayer Impact: The limited competition for this substantial contract means taxpayers may not have benefited from the most competitive pricing that a full and open competition could have yielded. This could translate to higher overall costs for the government and, by extension, the taxpayer.

Public Impact

Farmers and agricultural producers will benefit from more efficient and modernized loan servicing and management processes. The contract delivers critical IT infrastructure and software development services for the Market Assistance Loan (MAL) Farm Program. The geographic impact is national, supporting the administration of farm programs across the United States. The project implies a need for skilled IT professionals in areas such as SAP, system development, testing, and production support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The Time and Materials contract type carries inherent risk of cost overruns if not meticulously managed and monitored.
Limited competition raises concerns about whether the government secured the best possible price and value.
The complexity of integrating nine SAP grantor processes and additional supporting functions presents a significant technical risk.
Reliance on a single vendor for development and long-term production support could create vendor lock-in.

Positive Signals

The contract aims to modernize critical financial and operational systems, potentially leading to improved efficiency and service delivery.
The scope includes comprehensive support, from development to production, suggesting a commitment to a stable and functional system.
The award to a known entity like General Dynamics Information Technology, Inc. may indicate a level of trust and past performance.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on custom software development, system integration, and IT support services. The market for large-scale enterprise resource planning (ERP) solutions like SAP, particularly for government agencies, is specialized and often dominated by a few major players. The value of this contract, exceeding $119 million, places it in the category of major IT procurements. Comparable spending benchmarks would typically involve other large federal IT modernization projects or significant SAP implementations within other government departments.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications or specific small business set-aside analyses to report based on this information. The primary contractor, General Dynamics Information Technology, Inc., is a large business, and the contract does not appear to have specific provisions for small business participation.

Oversight & Accountability

Oversight for this contract would primarily fall under the purview of the General Services Administration (GSA), specifically its Federal Acquisition Service, which awarded the contract. As a Time and Materials contract, rigorous monitoring of labor hours and material costs by the contracting officer and program managers is crucial for accountability and preventing cost overruns. Transparency would be enhanced through regular reporting requirements stipulated in the contract. While specific Inspector General (IG) jurisdiction isn't detailed, the GSA OIG would likely have oversight responsibilities for potential fraud, waste, or abuse related to this procurement.

Related Government Programs

Federal IT Modernization Programs
SAP Implementation Projects
Agricultural Loan Management Systems
Government Financial Management Systems
Enterprise Resource Planning (ERP) Contracts

Risk Flags

Potential for cost overruns due to T&M contract type
Limited competition may impact value for money
Complexity of integrating multiple SAP processes
Risk of vendor lock-in with limited competition
Need for robust oversight of T&M labor and materials

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $119.0 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. THE SCOPE OF THIS TO IS TO CONFIGURE, DEVELOP, TEST, DEPLOY AND PROVIDE PRODUCTION SUPPORT FOR THE MIDAS RELEASE 1 SOLUTION, AND UPDATE THE MIDAS PROJECT MANAGEMENT PLAN. MIDAS RELEASE 1 SHALL INCLUDE THE NINE SAP GRANTOR PROCESSES, ADDITIONAL SUPPORTING PROCESSES INCLUDING BUSINESS PARTNER, FARM RECORDS, ACREAGE REPORTING, AND ACTUAL PRODUCTION, AND LOAN SERVICING FUNCTIONS (RECEIVABLES MANAGEMENT) FOR THE MARKET ASSISTANCE LOAN (MAL) FARM PROGRAM FOR ALL CURRENTLY SUPPORTED CROPS EXCEPT COTTO

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC..

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $119.0 million.

What is the period of performance?

Start: 2012-01-06. End: 2014-01-31.

What is the track record of General Dynamics Information Technology, Inc. with similar large-scale SAP development and support contracts for federal agencies?

General Dynamics Information Technology, Inc. (GDIT) has a substantial history of performing large-scale IT services for various federal agencies, including complex system development, integration, and sustainment. While specific details on their past SAP implementations for grant management or agricultural programs would require deeper research into their contract portfolio, GDIT is known for its capabilities in enterprise IT solutions. Their experience often includes managing significant budgets, complex technical requirements, and long-term support engagements. Assessing their specific track record for this type of project would involve reviewing past performance evaluations, any reported issues or successes on similar contracts, and their overall reputation within the federal IT contracting space. Given the scale and nature of the MIDAS project, GDIT's established presence suggests they possess the organizational capacity and technical expertise to undertake such a significant endeavor.

How does the $119 million award compare to the typical cost of similar federal IT modernization projects involving SAP?

The $119 million award for the MIDAS Release 1 solution is substantial and falls within the range of significant federal IT modernization projects, particularly those involving complex ERP systems like SAP. The cost of such projects can vary widely based on scope, duration, specific modules implemented, customization required, and the number of users. Large-scale SAP implementations for government agencies often run into tens or hundreds of millions of dollars over several years. Factors like the number of integrated processes (nine SAP grantor processes plus supporting functions in this case), the level of customization, and the required production support contribute significantly to the overall cost. Without a direct comparison to projects with identical scope and complexity, it's difficult to definitively benchmark this award. However, it aligns with the general magnitude of investments seen in major federal IT system overhauls.

What are the primary risks associated with a Time and Materials (T&M) contract of this magnitude and duration?

The primary risk associated with a Time and Materials (T&M) contract of this magnitude ($119 million) and duration (756 days) is the potential for cost overruns. T&M contracts pay the contractor for the actual labor hours and materials used, plus a fixed fee or profit. If project scope creeps, inefficiencies arise, or the contractor's labor rates are high, the total cost can escalate beyond initial estimates. For the government, this means less cost certainty compared to fixed-price contracts. Effective oversight is critical; the government must meticulously track all hours, materials, and ensure the work performed is necessary and efficient. Without strong project management and vigilant monitoring by the contracting officer's representative (COR), the government could end up paying significantly more than anticipated. This contract type is often used when the scope is not well-defined initially, but it places a greater burden on the government to manage costs.

How might the limited competition ('NOT COMPETED UNDER SAP') impact the long-term effectiveness and cost of the MIDAS system?

Limited competition, particularly when a contract is 'NOT COMPETED UNDER SAP,' can have several implications for the long-term effectiveness and cost of the MIDAS system. Firstly, it may mean that the government did not leverage the full spectrum of market innovation and competitive pricing available. This could result in a higher initial cost than might have been achieved through a full and open competition. Secondly, if the limited competition was based on a specific technology or vendor pre-selection, it could lead to vendor lock-in, making it more difficult and expensive to switch providers or integrate future solutions. While the chosen contractor may be highly capable, the lack of broader competition reduces the pressure on them to continuously innovate and offer the most cost-effective solutions throughout the system's lifecycle. This could potentially lead to higher sustainment costs or slower adoption of technological advancements over time.

What are the potential benefits and drawbacks of implementing the MIDAS Release 1 solution, which includes nine SAP grantor processes?

The implementation of the MIDAS Release 1 solution, incorporating nine SAP grantor processes, offers significant potential benefits. These include enhanced efficiency in managing agricultural loan programs, improved data accuracy and reporting capabilities, streamlined workflows for both agency staff and loan recipients, and better compliance with regulations. By leveraging SAP, a robust ERP system, the government aims to achieve greater integration across financial and operational functions. However, there are also considerable drawbacks and risks. Large-scale SAP implementations are notoriously complex, expensive, and time-consuming, with a high potential for delays and cost overruns. Integrating nine distinct grantor processes requires meticulous planning and execution to ensure seamless operation. User adoption can be challenging, requiring extensive training and change management. Furthermore, the reliance on a complex system like SAP can create dependencies and require specialized, costly maintenance and support.

What is the historical spending pattern for the MIDAS program or similar agricultural loan management systems within the GSA or USDA?

Historical spending patterns for the MIDAS program or similar agricultural loan management systems are not directly available in the provided data snippet. However, the award of $119 million for MIDAS Release 1 suggests a significant, multi-year investment. Typically, such large IT modernization efforts are part of a broader strategy to update legacy systems and improve service delivery within agencies like the Department of Agriculture (USDA), which often manages farm loan programs. GSA, as the contracting agency here, facilitates procurement for other agencies. Spending on similar systems would likely involve substantial capital outlays for software, hardware, development, integration, and ongoing maintenance. Analyzing historical spending would require accessing budget documents and contract databases for relevant agencies over several fiscal years to identify trends in IT investments for program management and financial systems.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Sterling Parent Inc. (UEI: 968838909)

Address: 4300 FAIR LAKES CT, FAIRFAX, VA, 11

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $122,362,549

Exercised Options: $119,536,738

Current Obligation: $119,024,325

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GSTFMGBPA100001

IDV Type: BPA

Timeline